NVIDIA to Curb AI Chip Smuggling with Location Verification Technology
In Focus
- NVIDIA’s location verification technology works as an optional software update
- The chipmaker will add the software in its Blackwell chips first
- The software uses time delay to communicate with NVIDIA servers
U.S. AI chipmaker NVIDIA has developed chip verification technology that might show which country its semiconductors are located. According to Reuters, NVIDIA’s chip location verification technology will reportedly prevent smuggling of its AI semiconductors to countries where export bans are in force.
Technology Monitors AI GPUs in Data Centers
NVIDIA hasn’t released the technology yet, but it has showcased it privately. The company has designed NVIDIA’s location verification tech as an optional software update that customers can install. The software works by leveraging the confidential computing capabilities of NVIDIA’s graphics processing units (GPUs).
“We’re in the process of implementing a new software service that empowers data center operators to monitor the health and inventory of their entire AI GPU fleet. This customer-installed software agent leverages GPU telemetry to monitor fleet health, integrity and inventory,” NVIDIA said, as stated in Reuters.
The chipmaker plans to include the software in the NVIDIA Blackwell chips first, before adding it to other semiconductors. NVIDIA designed Blackwell chips with high security features compared to previous generations like Hopper and Ampere semiconductors. These features support a process known as attestation. The company is, however, exploring security options for its previous chip generations.
NVIDIA builds location verification technology months after the U.S. captured illegal shipments of NVIDIA’s H100 chips to China through Southeast Asia. H100 chips are among the most powerful processors in the market, and their exportation is heavily restricted.
How NVIDIA’s Chip Verification Technology Works
The main reason why NVIDIA developed the chip verification software was to monitor the overall computing performance of its processors. This practice is common among firms that purchase high volumes of chips for large data centers.
The software uses time delay to communicate with NVIDIA servers, giving the company an idea of where its chips are located. If launched, NVIDIA’s smuggling prevention software could help in addressing concerns by the White House and lawmakers.
In recent months, the U.S. Congress had called for stronger measures to prevent illegal entry of American AI chips to countries where their sale is restricted. In August 2025, the U.S. government announced plans to protect advanced AI chips with location trackers.
The move was aimed at controlling the flow of American semiconductors to the Chinese market. Last week, federal prosecutors in the U.S. charged two men for illegal transfer of NVIDIA AI chips worth over $160 million from the United States to China.
China’s Reaction to U.S. Chip Location Verification
Calls for chip location tracking have caused Chinese authorities to question NVIDIA officials over the presence of backdoor access in its products that could allow the U.S. government to bypass security features. The company strongly denied that its products provide backdoor access.
Earlier this week, President Donald Trump said he would allow NVIDIA to export H200 chips to China. However, policy experts remain skeptical that China would allow its company to buy the chips.
